Trading With The Flow!!!

Hello

Starting a new thread but am not sure where it shoud go (once again).

Request to Mods to shift it to proper location

Thanks
Rajesh

Oilman
I dont know,whether i am right to write here….forbidden art of trading will be exposed here.many a pro r available here in this great forum…i request them to make comments.

1. why they r superior ?
SAINT Sir
There is nobody superior or inferior as far as markets are concerned…….and the time you do feel that you are superior, that will be when the market cuts you down to size.

2. what time frame they trade?
Intradays and position trading…….love playing the weekly as well as the 5min charts.

3. how far they r subjective in trading ?
Used to love words like "subjective", "mystical", "intuition" once upon a time…….nowadays, the attitude is more to objectification of the whole process. Do whatever it takes, an automated system, or set points of entry, exit and the discipline to always follow the rules of your trading plan. Whatever……..but one cannot beat all this fear and greed and hope, by joining the crowd. One therefore stands aside, follows the rules, practically robotic, day after day.

4. what r the reasons for their actual consistency ?
A trading plan of attack,and then the discipline to follow it to the tee.

5. on what condition they dont trade ?
There are many,like achieving the targets and more for the month.Also not trading if taking a hit and a predefined percentage point is hit.Or if there is some sort of family emergency……etc etc.

Of course,importantly,when I have a rip roaring,rollicking bullish 60min,I do NOT trade the 5min and stupidly go short.There is enough profits to be made just following the trend of the 60min and trading the 5.

6. what is their contingency plan[enough is enough..now i am booking loss
Hmm…….stop loss for every trade.Position sizing appropriately.Set Risk percent per trade.Monitoring average wins,losses,drawdowns……blah blahblah,think that what everybody here already knows.

7. what self sabotage u find most difficult to overcome..yet how u have done it ?
Anticipating a move before it happens,trying to get in even before your trading strategy says so………got licked many times doing that.But not too much of a problem these days ………now in only when the move happens.

8. do u think beginner trader[4yr amateur] can be like u oneday ?if yes. HOW!
Any fool can be a trader,every beginner trader can one day become an experienced one.Every trader with a plan and strategy that works can make money off the markets.Why then are 99% people failing at the markets?They go by what a newsletter,a self proclaimed guru,their broker,etc tells them to do.They go by their gut feel,or their neighbour's gut feel.They believe that making money is an evil act.They believe that trading the markets is for spare change .They have yet to educate themselves.They have no plan,no modus operandi,no strategy,no plan of attack……………

Approach trading like a business,have a business plan,a trading plan.We are in this to make money and lots of it,as in any business.But strangely,to make lots of money,you have to shift the mind's focus from making money to putting in that perfect trade.Although it's one and the same,you have to maintain focus on the trades.
Everything is cold,calculated strategy and then a disciplined implementation.We are in this to capitalise on other people's fear and other people's greed…….and for that,your own mind cannot work in the process of fear and greed.It has to be quiet.In the present moment.Practically like meditation.

Can anybody and everybody do it?Of course,provided you do all what it takes to be a trader.But sadly,that will never be the case……..99% will always lose,not because it's difficult,but because these 99% will not approach it with a plan,with the required discipline………That stat will always remain.

Can you be that 1%?Surely and definitely,provided you are willing to pay time and energy and focus to making yourself a great trader.

All the best!
Saint

WOW! what a thread….

Thanks alot Rajesh!

MJ-

"Science brings with it absolute parameters that have to be followed.It brings with it rigidity.To go with the Flow,you need flexibility,fluidity of motion……it's a Dance.This thread is all dance,………we need certain parameters,not too many,and not too many absolute parameters.Else we destroy the Flow,and that destroys the very purpose of this thread." By Saint

Superb, Thanks Rajesh for collecting all these gems in one basket with your deep dives in the past (ocean). Very inspirational.

But the one which I like most is "You cannot change the direction of the wind,but you CAN adjust your sail…"

Reason: It is the one statement that is the heart and soul of flow trading and which may be the difference between the 1 and the 99%. We dont try to predict, or control the markets. But yes we can control our trades so that they point in the direction of the market. Now if the market (wind) changes direction we adjust our trades (sails).

There are a few more things to be learned from the above (all learned the hard way from personal experience and other's experiences):

We all have a take on which way the market is going or going to go during any point in the day. This take comes from what we heard on TV, read somewhere, what SGX looked like today, what we think that news which is going to come from US, RBI, Finance ministry, etc is going to be. What ever the reason that take is always there.

This take keeps giving us trading advice - which we dont want and can do without. We graduate from the 99% to the 1% when we recognise that advice for what it is - trash talking - and learn to accept and then ignore it. Some times we succeed sometimes we dont and pay the price.

Imagine a sailor who adjusts his sails according to where he thinks the wind will blow or should blow rather than where it is blowing now. He is going to go only in one direction - Down. But it doesn't end there, that is the joke. Instead of realising the problem, he then gets back on the boat and thinks why his prediction went wrong, and then improves his prediction and the story repeats.

So instead of trying to recognise and discard that trash talking, we then wonder why our take went wrong, and focus on improving it. Then we find the explanation for our take going wrong - it was expiry day, the market had priced it in before, or some such and them improve our take on the markets. May be good for guys on CNBC whose money is probably not on the table but did not help me much.

After improving my take many times and making many a donation in the process, these days I am better at dealing with the trash talking. Every day when I sit down at the terminal, I try to remember these few things which is slowly becoming a habit:

1. It is not my job to predict or control the markets (which is not in anybody's control anyway).
2. It is not my job to make a profit or a loss. That is done by the trading plan.
3. I have no idea whether the day will end in a profit, or which trade will give me my profits, or losses.
4. If I feel that a tweak is required in the trading plan, I will consider it after the markets and incorporate it in my plan, but not in the middle of the day.
5. My only responsibility is to enter my trades according to my current trading plan, as best as I can.

Almost there, but even now trash talking does get to me - rarely - to upset my boat and as a grim reminder of the above. :)

flock..great write up

Thanks Bijo.

Thanks Rajesh, Kaiser, Flock. Nice to see the collection.

Regards
Saurabh.

The following post of the Saint is from TJ…. thought would be worth to read once again…
Kaiser…

Don't focus on the amount made……that may differ from month to month,from scenario to scenario.Focus instead on the following:

a.Cutting your losses and adhering to your stops is vital
b.Letting your profits run as long as possible till pivots crack.
c.Adding to your winners when markets trend.
d.That adding to the winners is vital to balance off the few stopped out trades and push the month accounts into the positive.
e.Discipline,staying in the "Now",going with the Flow,keeping the "I" out of the trades.
f.That with sufficient capital and a good strategy,massive gains can be made without the use of fancy stuff.
g.The sky is the limit…………nope,apologies,your Mind is your Limit.So have no set Goals(not an intraday advice,talking abt 60min Flow),have no Goals,follow the strategy and be Happy with whatever the market gives us.It could be 20 pts on JPA,or 350 pts on JPA.Focus instead on the trade,and whether you entered correct,added correct,and reversed correct……and you can make as much gains as the pivots/trends and your Mind allows you to.